Many cable networks launch their 2007 upfront campaigns this month, in part through splashy events and press briefings in New York and Los Angeles. DirecTV will be stumping for ad dollars as well. The satellite distributor begins making its ad presentations to agencies in several markets early next month.
The veteran cable rival has good reason to be optimistic. Its national ad sales revenue grew 27% from 2005, and Bob Riordan, DirecTV’s SVP of ad sales, anticipates doing as well or better this year. Bank of America and DaimlerChrysler were among those buying real estate on DirecTV for the first time in 2006. And although cable doesn’t compete with satellite for national ad campaigns, every dollar spent on satellite is an ad dollar not spent on spot cable.
Riordan credits much of the new business to upfront sales. Consequently, DirecTV will be doing more ad agency presentations this year than it did in 2006. "We want as much business as we can write," Riordan says of his agency campaign. "At 16 million subscribers nationally, we have a robust platform and a great story to tell about the quality of our audience: [They’re] upscale, watch more TV than other people and are early adopters of digital technology. I suspect [EchoStar] also wants to make those points."
Cabletelevision Advertising Bureau president Sean Cunningham says cable operators should watch DBS’ upfront maneuvering, even though satellite has a long way to go before it will take a big bite out of cable’s ad revenue pie.
Cable operators finished 2006 with $6.3 billion in billings from national spot, regional and local advertising, up 8% from $5.8 billion in 2005. However, "video advertising gets more competitive with each successive quarter, and every dollar won by an MSO is a dollar not won by someone else," Cunningham says.
For DirecTV, sports programming such as NFL Sunday Ticket and the new HotPass multichannel in-car coverage of NASCAR races will be highlighted at the upfronts. So will CD USA, Project My World and other attractions on Channel 101, DirecTV’s home of original non-sports fare.
Cunningham says cable operators can counter DBS’ ad pitches by emphasizing their local market penetration and the ability to combine local avails with space on Web portals, video on demand, DVR and ITV. "Use all your assets and work with the advertisers to sell more stuff," he adds.